Kausfiles: A mostly political weblog.

When GM says 'Here's your money back,' they really mean it!

GM "says it will begin to pay back U.S. loans." But of course it's paying back that debt to taxpayers with money from ... taxpayers. Even the new, nicer Truth About Cars isn't falling for it. GM got $50 billion from the government, after all, mainly for a 60% share in the company. It's planning to pay back $1.2 billion in December--basically a PR attempt, TTAC speculates, to erase its negative consumer image as a bailout baby. The only hope for the taxpayers actually being repaid for their entire $50B investment is an IPO. TTAC pinpoints 2010 as the ideal year, when the innovative Chevy Volt will be conveniently not yet released. "GM’s hail-mary will provide a speculative upside to GM’s value as long as it’s still just around the corner." ...
 
P.S.: Also, these financial results are not GAAP-ready. "North American Operations are still bleeding cash. And, as Henderson has admitted, the fourth quarter results for 2009 are only going to bring worse news." [TTAC again]  ...  P.P.S.: But GM will launch a company-wide sale this week to clear excess U.S. inventory. A sure sign of success! ...  2:58 P.M.

___________________________

Amnesty's Last Chance?

New push for "comprehensive" (i.e. including amnesty) immigration reform:

1) Is it good for Obama's health care effort that this comes out now? Doesn't it potentially make 2010 midterm voters more uneasy about Dem overreach? Maybe it placates Hispanic lawmakers who might be upset at the treatment of illegals in the health bill itself--but that's Obama again playing the inside game of keeping Congress' factions happy. His problem is the outside game of keeping the public on board, no? ... Wait, I forgot. Health care reform is a fait accompli. Never mind. ... P.S.: Or maybe Obama has concluded that health care reform gets more unpopular when voters think about it, so he's changing the subject. ...

2) It seems like almost yesterday that the official, liberal pro-legalization position was that the decline in the number of illegals had little to do with increased enforcement. It was all the declining economy. (After all, illegals are here to stay and there's nothing we can do about that, right?  But if enforcement works to produce a big demographic shift ....) Now Obama Homeland Security secretary Janet Napolitano is claiming that we can go ahead with legalization because "better enforcement" has indeed worked to produce a decline in the number of illegals. But wasn't that all due to the economy? I sense a contradiction. ...P.S.: Maybe another factor was the 2007 defeat of comprehensive immigration reform itself. Without the promise of a legalization and eventual U.S. citizenship, crossing the border seemed less worth the risk and sacrifice ...

3) If the economy is even a partial factor, shouldn't we wait until enforcement techniques survive an actual, illegal-attracting economic rebound--and court attacks by the Chamber of Commerce, the Hispanic caucus and civil libertarians--before we proclaim those enforcement techniques enough of a success to withstand an illegal-attracting amnesty? Napolitano's speech never explains why the enhanced enforcement powers she says she needs--"tougher anti smuggling laws," greater penalties for "dishonest businesses" and immigration attorneys, etc.--couldn't be enacted without tacking on an amnesty.  Maybe she has an argument, but she doesn't make it.

4) Are Democrats going ahead with immigration legalization in 2010 because they realize the way things are going they will have no chance in 2011? ...

Update: Mark Krikorian, noting the number of times Napolitano said the onus was on Congress to act, thinks I'm being unsophisticated if I believe the White House actually plans a significant amnesty push in 2010:

But with unemployment over 10 percent, among other reasons, Congress isn't going to do any of this, so the White House is giving itself plausible deniability.

String along La Raza, prepare to blame Congress for failure, and make sure it's all reported in the least-read newspaper of the week. As my colleague Jon Feere writes, "Amnesty is a year away, and always will be." [E.A.]

But in a year, it won't be a year away. Not after the 2010 midterms. ... 10:11 P.M.

___________________________

If California's neighbors--Arizona, Nevada and Oregon--are almost in as bad fiscal shape as California (according to this Pew chart) doesn't it suggest that California's problem can't just be high taxes. Nevada and Arizona are relatively low-tax states, no? Yet they're going broke too. Of course they still have public employee unions. ... P.S.: Maybe it's some regional phenomenon. Gee, what problem might these states clustered in the Southwest near the Mexican border have in common? ... I'm thinking! ... Update: David Berger notes that "CA, AZ NV and FL have something else in common - most overbuilt during the housing bubble." ...  [Via John Ellis, who twitters more than I'd realized. Ellis, a Bush relative, is not a 'Don't Worry, Be Happy' kind of guy. He's a "Worry" kind of guy. Which is one reason he's valuable.]

P.P.S.: Like many people, I found William Voegeli's recent City Journal piece on the decline of the high-tax/high-service model of state government extremely clarifying. Nut graf:

Whatever theoretical claims are made for imposing high taxes to provide generous government benefits, the practical reality is that these public goods are, increasingly, neither public nor good: their beneficiaries are mostly the service providers themselves, and their quality is poor.

In short, now we pay high taxes and get lousy services. Worse than Texas! ... But looking at that Pew chart I wonder if this is really the explanation of California's current fiscal trouble--as opposed to a more general explanation of why Californians would be getting a lousy deal from their union-dominated state government even if the state's books were balanced? (You have to think that Jon Corzine in New Jersey was a victim of the same phenomenon.) The fiscal crisis is mainly just a convenient news hook, no? ...  9:40 P.M.

___________________________

Man Doesn't Bite Dog! Detroit-bashing Truth About Cars catalogues Chrysler's assets--and discovers they're not nothin'. The biggest one: faster-moving management than the GM lifers Rattner left in place. ... 9:23 P.M.

___________________________

Suckers of the Week

Explainer Wanted: Why would a politician ever concede a non-blowout race until every last ballot is counted? The momentary frisson of good will can't be worth the possibility that the concession will turn out to have been a mistake--as it was for Jimmy Carter in 1980, Al Gore in 2000, and now conservative Doug Hoffman in the NY-23 congressional race. ... Hoffman will probably still lose when all the ballots are in, but his concession has already had real world consequences--it allowed Nancy Pelosi to swear in Hoffman's Democratic opponent in time to give health care reform its narrow House majority. I'm assuming the people who voted for Hoffman aren't happy with that. ... P.S.: Dick Morris claims, plausibly, that Pelosi had many Dem votes in reserve. Still, thanks to Hoffman's concession she didn't have to use them. ...

Update: Mystery Pollster answers.

One answer: They remember Ellen Sauerbrey http://tr.im/EToC Hoffman wants to run again next year, also counted right http://tr.im/EToX 

I'm not convinced. You don't have to be nasty about it. Just say "Let's see how it turns out" and don't concede. ... 9:48 P.M.

___________________________ 

Things you thought you were getting in the auto bailout. ... Chrysler's showy electric and hybrid cars? Forget them. Now that Chrysler has your money, they're dead. ... GM's 2010 IPO? The one that was going to raise money to repay taxpayers? It's receding rapidly into the future. "It depends on how quickly we become profitable. ... I can’t promise a date," says GM Chairman Ed Whitacre. Translation: Not going to happen. ... Suckers! ... 9:40 P.M.

___________________________

Am I the only one who smells Kabuki in the reports that President Obama has dramatically rejected all the Afghan war options with which he was presented, demanding to know where the "off ramps" are? If you were about to recommend a troop increase that was unpopular, especially with your Democratic base, wouldn't you precede it with some drama like this to demonstrate that you are a) in charge, b) not being conned, and c) insistent on a withdrawal as quickly as possible? Just asking. ... 10:54 P.M.

___________________________

What's wrong with the upcoming Chevy Cruze? Production of the new compact has been delayed three months. The New York Times says the problem is "engine performance and the quietness of the Cruze's ride." AP, quoting the same GM executive, says the problem is the transmission ("No one was thrilled with where it shifted, how it shifted.") What if they're both right? ... P.S.: It's fine that GM postpones a launch for a car that's not yet up to snuff. But the NYT's Bill Vlasic is a sucker for buying the line that this sort of delay represents a dramatic "culture" shift: 

In the past, G.M. rarely held back a product to add the extra touches that would improve its chances in a fiercely competitive market.

Please. GM's been peddling this line for years. See, for example, this U.S. News report:

Concerns over quality have substantially altered the way Detroit launches new models. A case in point is the line of luxury midsized cars planned for this fall by Cadillac, Buick and Oldsmobile. Transaxle problems with these front-wheel-drive C-body models caused GM to delay their introduction until at least January, and possibly spring. ''The car will have to tell us when it's ready," says Robert Burger, Cadillac's general manager. Notes a longtime industry observer: ''In the old days, that would be unheard of. They'd move the cars in the fall, whether they were right or not.''

That paragraph was published in 1983. ... 10:56 P.M.

___________________________

"CNN doesn't have a brand.  It has a bland.  It just got blander." -- Alert reader T. ...  11:36 P.M.

Conservatives Against "Spiritual Health"

Conservatives against prayer ... Or, rather, against requiring health insurance in Obama's "exchanges" to cover prayer treatment ("religious and spiritual health care"). a) Yes, a government-run plan will always have to contend with this sort of pressure, in addition to pressure to cover experimental procedures and expensive mental health treatments. These pressures are often harder for our political system to resist than for private insurers to resist; b) But if the government can avoid covering Christian Science prayer treatment under Medicare you'd think it could avoid covering it under the smaller health insurance exchange plans envisioned by the Dems, no? c) Wonder which way Sarah Palin comes down on this; d) Can the Scientologists be far behind? ... 12:18 P.M.

___________________________

Hugh ("only time will tell") Sidey has a worthy successor: Eugene Robinson in this morning's WaPo:

Reading too much into Tuesday's off-off-year election results would be a mistake, but reading too little into them would be wrong as well.

[Thanks to reader J] 12:08 P.M.

____________________________ 

Chrysler to break out new "Ram" line of trucks. If they'd called it the Rahm line I'd really start to worry about politicization. ... P.S.: Chrysler has now "projected that it will double its sales over five years." Do you believe that? Me neither, though I guess if Chrysler sales keep falling (down 39% so far this year from last year, which wasn't so great itself) they'll eventually be able to double their sales just by selling another one. [Update: They put an actual number on what they expect to do--increase sales from 1.3 million in 2009 to 2.8 million in 2014. With this? Okeydokey.] ... 12:04 P.M.

___________________________

Election 2009: Were the Exit Polls Wrong Again?

Why do I get the feeling that the VNS Exit Polls were way off--in a pro-Dem direction--once again? Answer: Because early evening posts like this one from Marc Ambinder seemed to be hinting at a Corzine victory:

Courtesy of CBS News: If Jon Corzine wins re-election, he can thank women, who gave him a narrow advantage and who voted at higher proportions than men did.

He could have written "If Chris Christie is the new governor of N.J., he can thank men, who gave him a huge advantage ..." But ... he didn't. Did the exit polls show a relatively big Corzine victory? Back in the day when the exit polls were widely leaked, everyone would know what they were and--if they were wrong--they would know that they were wrong. Now they are more closely held--which allows the VNS to keep screwing up and hide its inaccuracy ... Again, if we can't trust the exit poll's bottom line result (presumably due to a subtle bias in which voters pollsters talk to) why can we trust any of the demographic breakouts that scholars, etc. use? Won't they be subtly biased too? ...

Update: A kf source reports

Exits were close in VA and Corzine ahead in NJ. 

Pathetic! I guess I was wrong when I said they were subtly biased. ...  7:25  P.M.

___________________________ 

Hardy Perennial: Stuck in traffic this evening? Why the end of Daylight Saving Time invariably produces giant, gas-wasting jams on local freeways. ...  3:49  P.M.

___________________________

Shorter Nagourney (and you're not missing much): "Best outcome for Democrats: Win ... Worst outcome for Republicans: Losing ...."** ...

**--Those are direct quotes. I am not aware of all internet traditions. ... 3:46 P.M.

____________________________

This is not the market share we paid for: After a big ad campaign, General Motors gets an estimated 21% market share in October. Edmunds.com had predicted 22.4%. Kf analysts not impressed, await scathing TTAC take-apart. .. Update: TTAC punts to its readers, who note a) GM achieved this market share with lots of "incentives" (i.e. price cuts); b) GM introduced several new models, which is a good thing--but new models often produce a sales spike that evaporates within a few months. ... Bailout II still on track. ... 3:22 P.M.

___________________________

Night of the Goolsbee!

Good News for Hyundai: It looks as if UAW workers are rejecting the proposed contract that would not-quite give Ford the same concessions the union gave GM and Chrysler. After all, Ford is still losing fewer billions than the other two were losing before the government helped them slash their debt in bankruptcy. So Ford clearly needs to be bled a bit more. The near-certain prospect that Ford will in response ship more work out of the country may not matter if you are a UAW veteran 2 years away from retirement. ... P.S.: Is Obama aide Austan Goolsbee's prediction--that saving Chrysler would cripple Ford's comeback attempt--coming true? ... [via TTAC]  5:41 P.M.

___________________________

Titans of Spin: Chickaboomer on CNN CEO Jon Klein's hypocrisy. (He used to think the 25-54  demographic segment that CNN's now losing was crucial.) ... Mediaite makes the same point--more respectfully, alas. ... P.S.: Remember what CBS veteran Bernard Goldberg said of his former colleague Klein: 

"[A]t CBS news he had a reputation as the kind of guy who thought people who tell the truth do it mainly because they lack imagination.

5:40 P.M.

___________________________

Fisker also announces upcoming "Seppuku" two seater: Why would electric luxury car maker Fisker decide to build its new model in a UAW shop in Delaware that only recently turned out some of the least reliable cars GM made? TTAC suspects federal dirigisme. ... 5:39 P.M.

___________________________

The Man Who Didn't Save GM

Detroit Bailout II Nears the "Old News" Stage! 1) My colleague Daniel Gross thinks the GM and Chrysler bailouts weren't designed to actually save GM and Chrysler:

Sure, there was brave talk of reviving these once-proud brands and returning them to their rightful place in the pantheon of American corporations. But from the outset, I've believed that the interventions were simply efforts to delay liquidation rather than to avert it altogether, to provide a breathing space in which managers could find homes for valuable assets (other companies) and find chumps to absorb the losses from bad decisions (that would be the taxpayers). [E.A.]

2) I'm pretty sure Dan Gross is a friend of Steve Rattner. 3) Does Dan Gross know something we haven't been told? 4) If so, has anyone told President Obama, who--in Ryan Lizza's New Yorker piece, anyway--seemed to want the auto bailouts to actually "succeed." ... P.S.: Larry Summers was "comfortable Chrysler would survive," writes Rattner himself in an almost unreadably self-serving account of his bailout experience. "Comfortable"? Chrysler? Hello? Whose elevator goes straight to the garage? ... P.P.S.: For his part, Rattner characteristically hedges his bets, boasting only that his team gave Chrysler and GM a "healthy margin for error." Or, as Dan Gross might translate it, "a few more months." ... 12:15 A.M.

___________________________

So You Think You Have Swine Flu? Am I the only one--besides Michael Fumento--who finds reports like NBC's last night on the spread of swine flu ("galloping its way across the country") to be wildly unconvincing? The NBC piece claims "90 dead" last week under the rubric "swine flu cases." [See about 1:10 in] This is almost certainly BS. As this CDC report makes clear, that figure includes both the swine flu and the regular annual flu. Indeed, NBC promiscuously conflates a) swine flu (H1N1); b) regular flu and c) "flu like symptoms" which may not be any kind of flu at all. ... That may be because the CDC itself has decided to conflate at least the first two categories, as noted in this seemingly damning CBS story and confirmed in the CDC report itself:

This new system was implemented on August 30, 2009, and replaces the weekly report of laboratory confirmed 2009 H1N1-related hospitalizations and deaths that began in April 2009. Jurisdictions can now report to CDC either laboratory confirmed or pneumonia and influenza syndromic-based counts of hospitalizations and deaths resulting from all types or subtypes of influenza, not just those from 2009 H1N1 influenza virus. [E.A.]

I think this means the CDC does not really know how many cases are swine flu and how many aren't. (The regular flu kills many thousands of people every year.) ...12:43 A.M.

___________________________

It's All Going According to Plan!

Peter Beinart thinks Obama's on track to success. Actually, Beinart understates the favorability of the circumstances. If, like me, you assume that the most desirable and popular part of Obama's agenda is health care reform, while the rest of it is studded with sweeping measures that are controversial at best (cap and trade, "card check" union organizing) and explosive at worst (illegal immigrant legalization)--well, then everything is falling into place like a well-choreographed water ballet!

The kf Plan for Presidential Success:

-- Obama gets health care reform, but not until well after New Year's Day. That leaves no time in 2010 to take up "card check" or "comprehensive immigration reform" before the election season hits. Darn! Even "cap and trade," which as Tom Edsall notes pleases affluent elites a lot more than Obama's low-income base, has to undergo further study. What can you do?

-- The economy picks up, but unemployment remains high enough--and doubts about health care reform among the elderly persistent enough--to get the Dems clobbered in the 2010 midterms. Republicans may even win back the House. All those controversial big Dem bills that got backed up in 2010--well, they certainly won't be enacted by the GOPs. So frustrating!

-- Without a new wave of low-wage immigrants drawn by legalization, meanwhile, the labor market eventually grows tight enough at the bottom to finally raise wages as the economy grows--just in time for Obama's 2012 campaign.

-- Returned to office in an incumbent-friendly year, Obama still faces a GOP-heavy Congress, sharply limiting what he can do. He's forced to shelve much of his ambitious second term agenda--sorry!--and focus on those areas where Republicans are favorably disposed--like reining in the cost of entitlements and expanding charter schools. (As Walter Shapiro once argued--and Bill Clinton proved--having a Democrat in the White House with a Republican Congress is the institutional recipe for controlling the budget. The Democratic President reins in defense spending while the Republican Congress reins in domestic spending.)

I'm only partly joking. Or maybe I'm not joking at all. Losing control of Congress didn't cripple Bill Clinton, did it? It arguably saved Bill Clinton. Having Newt Gingrich in charge of the House allowed Clinton to push off against Republican excess, tame his own party's demands, and actually balance the budget. The difference with Obama is that unlike Clinton he will have accomplished his main goal--health care reform--first, before the drawbridge goes up.

It's all going according to plan. 1:51 A.M.

___________________________

Bailout II Watch: A member of GM's board of directors has admitted that the carmaker's recovery plan is based on it maintaining a market share of above 19%:

"The public plan is 19 percent and change. That is what everything is being based on," [Stephen] Girsky said during a panel discussion at a conference at Columbia Business School.

That's about what GM's share has been recently. But it's been heading in the wrong direction. And if it sinks to 18% ...? 

Update: The Big Money's Matthew DeBord sneers at Truth About Cars for "heralding GM’s demise since gas was 30 cents a gallon and Sinatra was headlining the Sands. ... And yet ... GM lives!"  Plucky of GM! How did they survive? And to think Truth About Cars was predicting they would go bankrupt! ...

P.S.: DeBord persists in publicizing an auspicious "trend" in GM's market share. Yes, GM's share is up for  the last couple of months--but a) again, it doesn't do that much good to have a big share in the months when nobody is buying cars (September) if you have a much lower share during the big clunker sellathon (July and August). Here is a chart with the raw figures. See if you spot a significant pro-GM "trend." I don't.  b) You can always boost market share by offering cash-back incentives at the expense of profits. GM's incentives have been large--at an average $3,796, almost three times Honda's; c) DeBord cites an Edmunds prediction of a rise in GM's share to more than 22 percent in October, which is apparently based on visits to GM models on the Edmunds web site. We'll see. GM is shooting off a lot of its advertising wad this month. d) While Buick and Cadillac have "profit potential," the success of Chevrolet is "a question mark," DeBord concedes. But Chevy is where GM's volume sales are. If Chevy tanks, can GM survive? ... P.P.S.: DeBord sees growth. TTAC sees decline. One of them is wrong. My money's not on The Big Money. ... 2:25 A.M.

___________________________

Unions Bend the Curve!

I knew they'd find a way to punish Ford: The new UAW contract with Ford apparently does not give America's surviving non-bankrupt automaker parity with GM and Chrysler, reports Bloomberg: "The plan doesn’t include cuts to retiree benefits, such as vision coverage, that were granted to GM and Chrysler." Rather, the pain seems even more concentrated on future hires (if there are any) than with the GM/Chrysler deals. ... TTAC wonders whether the UAW had an extra incentive to resist giving concessions that might make Ford more successful now that the union owns a large chunk of its main domestic competitors.  ... P.S.: The argument that "the day the union owns the firm is the day workers will need another union" has always seemed a bogus argument against worker ownership. But in this case, where the union actually owns only competing firms, maybe it's not so bogus. Ford, GM and Chrysler workers used to have more or less equal status within the UAW. Now the union has a reason to give GM and Chrysler an edge wherever possible. ... 5:39 P.M.

___________________________

One Too Many Cherubim: Blog commenter "Cherubim," who may or may not be Elizabeth Edwards, has resurfaced . She's still a big Michael Jackson fan. ... P.S.: I would say this cuts against the Daily News report that Cherubim = Elizabeth. But others disagree.  ... P.P.S.: And yes, there is a Multiple Cherubim Theory. ... 4:52 P.M.

___________________________

Unions Bend the Curve! 'Card check' may be stalled in Congress, but Fred Siegel and Dan DiSalvo report that public employee unions are still successfully bankrupting states and cities. Highlights:

-- Unionization has bent the cost curve of government health benefits--in the wrong direction:

Under the brilliant leadership of Dennis Rivera, 1199 built a top-notch political operation, and with the hospitals, which were barred from political activity, formed a partnership to maximize the flow of government revenue. The union-hospital alliance has been so successful in aligning itself with politicians, Democrat and Republican alike, that not only has 1199 been largely untouched by the downturn, but New York spends as much on Medicaid as California and Texas combined. [E.A.]

That last sentence is stunning. Coming soon to a "public option" near you? ...

-- ACORN, not a straw man! According to Siegel and DiSalvo, it's becoming a real power in New York City thanks to its affiliation with the Working Families Party (WFP):

[T]he WFP is thriving while New York's Democrats atrophy. In last week's New York City primaries, WFP candidates for city council won easily, as did the party's candidates for the city's second and third highest offices: comptroller and public advocate. Those are the best platforms from which to make a run for mayor of New York City when Bloomberg finally gives up his throne.

-- Even Barry Bluestone--the leftish economist who was one of the first to spot the rise in income inequality--worries about the vast gap in the benefits public employees win and the vastly less lucrative benefits ordinary private sector workers get. Thanks in large part to public employee unions, Siegel & DiSalvo note, the price of state and local services is growing rapidly--41% from 2000-2008, vs. 27 percent for private services. Ordinary workers have to pay for them.

The justification for public sector unionism is way weaker than that for private sector unionism. "[Government] workers are not extracting a share of the profits but rather a share of taxes," as former N.Y. Liberal Party leader Alex Rose puts it. And the right to strike, in the hands of key public unions, approaches a blackmail power. But the political strength of the unions is such that even most Republicans, at the state and local level, are scared to question them. They gelded Arnold Schwarzenegger. You want to be next? ... 4:39 P.M.

___________________________

Q.: Who would have been a more disastrous nominee for the Democrats: John Edwards or Bill Richardson? A: Edwards, but Richardson is giving him a run for his money. ... 5:12 P.M.

___________________________

Obama v. Pajama

Pajama-Baiting: 1) You have to wonder if the unnamed Obama aide's "take off the pajamas" jibe was not a self-pitying expression of frustration but rather an intentional attempt to goad the liberal blogosphere, giving Obama some anger on the left to push back against, translating into a rise in the polls. Insta-Triangulation whenever he needs it--is that what the left bloggers do for Obama now? ... 2) The worst thing they could do, from this point of view, is to calm down. Don't cut him slack! Go wild. ... 3) This pajama-baiting, near-gaslighting strategy--bloglighting!--would fit the Obama White House pattern of attempting to set up superheated fringe figures as opponents--e.g. establishing Limbaugh, and Beck, and the Birthers as GOP leaders; ... 4) Don't assume it's Rahm! Early in the Clinton administration an inflammatory blind quote from an administration official predicted that  the White House would "roll right over" Sen. Moynihan if necessary. It inflamed Moynihan, anyway. Many in the press assumed the quote came from foul-mouthed Clinton aide Rahm Emanuel. My understanding is it didn't. [Update: Moynihan apparently thought it was Rahm--his diaries indicate reporter Michael Kramer told him as much. I'd heard Bentsen. Update II: Kramer has said it was Bentsen, in print.]... Given point (3), I'd suspect Axelrod of the anti-pajamatism.. ... 11:27 A.M.

___________________________

GM Bailout II Watch: Signs are just so darn "good" for New! GM that the company is backing off its commitment to the 2010 IPO that might get the government back some of its money before the midterms, says TTAC. ... Robert Farago suggests a get-past-the-election solution that might hold some appeal for Dems desperate to show progress:

Sure, as mid-term elections approach, the feds may try to game the system, offering some kind of IPO-enabling investor “protection.”

Do you think that will fly--i.e. politically be worth the controversy that making it happen would engender (as opposed to simply delaying the IPO until 2011 and issuing an updated round of optimistic projections)? Me neither. ... :8:12 P.M.

___________________________

@kausfiles--Guaranteed 51% Good News!

Items I twittered, or wished I had:  

Best News of the Week: According to RiShawn Biddle, Obama and his Education Secretary Arne Duncan really are using the leverage provided by federal stimulus money to force states to allow more charter schools. The teachers' unions "feel betrayed." Hope that's not just for show. ... P.S.: This unashamedly  pro-Obama article runs in ... The American Spectator. ... P.P.S.: Biddle also says the Bill & Melinda Gates Foundation has helped create a "counterweight" to the NEA and AFT. Won't make up for Vista! But it's a start. ... P.P.P.S.: If there are well over a million students in charter schools now, and the federal government is pushing them to grow like Topsy, at what point does a vicious circle set in, with public schools losing their even moderately motivated students, causing them to decline even further, causing even more students to leave, etc.? Not that this public school death spiral would be such a bad thing. We should just be prepared for it. The way we should have been prepared for GM. ... 11:27 P.M.

___________________________ 

Neiman Marcus is stealing The Atlantic's business model  ... OK, to really emulate The Atlantic you'd have to throw in David Axelrod, and maybe sub Marc Ambinder for Nora Ephron. ...  And then sell the thing to ExxonMobil. ... 11:26 P.M.

___________________________

51 is the Wussiest Number: Ryan Lizza reports that, in the White House debate over whether to bail out Chrysler, Obama asked his advisers, "What do you think the percentage likelihood is that , if we give this deal a chance, it will succeed?" Then-auto czarito Steven Rattner answered, "Fifty-one percent." ... What do you think the percentage likelihood is that Rattner's answer was sincere? I hope, for his sake, it's close to zero. There was substantially less than a 51% chance the Chrysler bailout would succeed (if "success" means a viable company). There still is. ... Not being a sophisticated investment banker, I would translate Rattner's answer as: "I know you'd like to approve this deal, and I'm not one to buck the tide, so I'll give you the minimum necessary reassurance, while covering my ass as much as possible (in the 80% likelihood that it fails)." ... P.S.: Lizza's piece is generally encouraging--the country could be in worse hands. But it's vaguely discouraging if for Obama and his brain trust the issue actually turned on whether or not the deal would succeed, which seems a less sophisticated question than whether or not it was worth trying to soften the blow to the Midwest by postponing Chrysler's inevitable failure. Could the whole debate have been Kabuki?  ... 11:25 P.M.

___________________________

Where's Crossfire When You Need It? Jon Klein's Triumph! CNN now in 4th place, losing to FOX, MSNBC, and itself (HLN)!  Somewhere Tucker Carlson is smiling. ... 11:24 P.M.

___________________________

GM Bailout II Right On Track!

According to the WSJ account of CEO Fritz Henderson's conference call, New GM! is meeting its goals ... except for the one about getting people to buy its cars. (Matthew DeBord, please note.)

GM lost two percentage points of market share in the critical U.S. market. Mr. Henderson said GM's market share remains slightly ahead of the conservative estimates the company made early this year when laying out its restructuring. ... [snip]
 
Mr. Henderson faces intense pressure from GM's new chairman and the U.S. government--the company's new majority owner--to stem the sales slide and improve GM's financial performance.

The company has responded by getting rid of its sales chief (who had failed in his goal "to reverse the decline in GM's U.S. market share") and replacing him with a GM lifer--or as the Truth About Cars puts it, "a lifer [who] owes her career to the timid, inept culture Henderson is simultaneously a product of and ostensibly bent on breaking." She may have a short tenure. But the next exec to go is much more likely to be Henderson himself, as must be by now clear to everyone (including Henderson).

There's also this advance Thanksgiving card:

However, GM has about 10,000 more U.S. workers than it plans to have by the end of 2009 after buyout programs for hourly and salaried programs fell short. GM aims to have 64,000 workers and isn't as far along toward that goal as it expected by this point.

So they let Henderson take the bad press for the layoffs, then they fire him! The bad news goes out the door, and the new CEO gets to do something more popular. ... Maybe it really is all going according to plan.

P.S.: Ten thousand new layoffs would provide a test of whether Congress and the White House can refrain from intervening to stop them, I suppose. Wouldn't it be better for the UAW to take a small cut in hourly pay and save some of the jobs? And attract more production in the future? ... But I forget: Hourly pay cuts hurt all union members. Layoffs only hurt the laid off. If you are an elected UAW official, the course is clear. ... 6:50 P.M.

___________________________

What is wrong with our democracy that it is losing the service of legislative giants like Mel Martinez? We shall not see his like again. ... 8:56 P.M.

___________________________.

Special Failure-Is-An-Option Edition

Robert Farago makes an obvious point that gets lost in all the rational b-schoolish discussions of General Motors' bloated dealer network: Often trust in the local dealer was the only reason people in rural America would buy one of GM's inferior cars:

"... well over a million fraudulent votes": Peter Galbraith on why he was recalled from his job with the UN's Afghan mission. ... 8:45 P.M.

___________________________ 

Sorry, DWELL. Prefab FAIL! You do miss things when you don't read the LAT. I missed Christopher Hawthorne's explanation of why high end prefab home designers suddenly seemed to close up shop. Economies of scale were not achieved! ... But that's the high end. You have to wonder whether the same fate has overtaken the makers of lower end kit houses, which often looked better anyway. ... 8:44 P.M.

___________________________

Toyota's Salvation

Lots of fuss lately about Toyota's troubles. ... I suppose there are two ways to look at it. 1) See, even Toyota's in trouble! Hah! ...2) Toyota is panicking and taking corrective action while there is still time as opposed to the Detroit/UAW traditional method of one step (or two, or three) too late. ... P.S.: I'm not saying that this too-little-too-late phenomenon is built into Wagner Act unionism. ... Oh wait. That's exactly what I'm saying. The Wagner Act sets up a clunky, rule-bound bureaucacy of tooth-pulling negotiation--especially when it comes to administering pain--that wouldn't have worked even in the WWII era of massive industrial behemoths if we'd had any competition. It certainly won't work today. ...

Of course, GM once tried to set up a subsidiary with a less clunky, less rule bound bureaucracy--with flexible shifts and profit sharing but many fewer work rules, etc.. The UAW killed it, lest all those efficiency-enhancing innovations spread to other GM factories (where they might have, you know, saved GM).  That wasn't what unionism was all about, argued the UAW traditionalists. They were right. Paul Ingrassia has the grim details.  [via Hit & Run via Insta]

Update: Fire Mickey Kaus helpfully documents kf's decade-long record of "fact-free-speculation" eerie prescience regarding the Plot to Kill Saturn. ...

P.P.S.: The Next GM/Chrysler Bailout (#2): Pelosi seems to be on board! [Detroit News]

Pelosi said Democrats want automakers to "thrive," and she hasn't ruled out additional support for automakers if they show that they are "viable."

Here's a striking chart suggesting why Bailout #2 might be needed sooner rather than later. ...Toyota is down 19%. But GM is down 45%. ... [via TTAC]

Update: Big Money's Matthew DeBord argues that "signs are actually good" for Detroit's Big Three because "[a]ll are seeing their market share increase," He's apparently referring to this chart, which shows GM's share rising (from about 18.8 percent in July to 19.46 in August to 20.87 in September) while Ford and Chrysler are essentially flat, Unfortunately, many more people bought cars in the cash-for-clunkers months of July and August, when GM's share was down. It doesn't do much good to have impressive market share in September if the market is puny. When you add up all the good and bad months in 2009 to date, in fact, GM's share has fallen from 22.3 in 2008 to 19.6 in 2009.  Chrysler's down from 11 to 9.2, Meanwhile, Ford rose from 14.2 to 15.2 (and in the most recent three months is up at 16.4). Honda has gained a tiny bit and Toyota's share is flat. None of that convinces me that "signs" are "good" for GM and Chrysler. (It is suprising that Toyota hasn't capitalized on their distress, which may explain this.) ...12:21 P.M.

___________________________

A big 10-pt jump in relative support of health care reform in Rasmussen's latest poll, which either says something about public opinion or something about Rasmussen. Either way, it's good for Obama, since Rasmussen has been the most pessimistic of the health care pollsters.** ... Maybe everyone is calming down as familiar, boring Senate moderates take center stage. ... P.S.: But the Rasmussen progress is hardly enough to pacify the throbbing Congressional id--health care reform still loses by a 50-46 margin. ...

**--Update: Until this grim new FOX poll.. ...12:20 P.M.

___________________________

Always trust content ... : kf readers are not surprised Gourmet magazine is dead.. They're surprised that Bon Appetit isn't. ... 12:19  P.M.

___________________________

Rattner's Legacy: The Chooch Is At the Door

Breitbart's Legacy? Rasmussen's latest poll finds, rather unbelievably, that voters say "government ethics and corruption" is now a more important issue than "the economy." With unemployment at 9.8%! Hello? Is this all James O'Keefe and Andrew Breitbart's doing? I can't think of any big recent corruption-related events other than the ACORN and NEA scandals. ... I doubt it is all liberals concerned about the power of the insurance lobby. ... P.S.: This might explain why, while the MSM still gives the ACORN scandals restrained coverage, the pols are running for the hills. They have pollsters too. ... P.P.S.: Rasmussen's survey, taken 9/26 --9/29, was half pre-Polanski, so that seems an unlikely explanation. ... Update: Ambinder writes as if Rep. Rangel's troubles are a central catalyst, which seems unlikely. Rangel isn't that famous. It's more plausible to blame general resentment over Wall Street sleaze and the bailouts. ... 4:02 P.M.

___________________________ 

The Call of Chooch: GM's sales are down 45% from last September (when sales were already bad enough to drive the company into bankruptcy). Chrysler is down 42%. Ford is only down 5%. Car buyers are clearly punishing the two bailout recipients brutally. Robert Farago of Truth About Cars--who has been right before--predicts that GM and Chrysler will both "go down by the end of next year" without a second, new federal bailout. The only question, he says, is whether the two manufacturers will need the cash before the 2010 midterm elections. He adds:

For those of you who say the Obama’s army never really intended to rescue either automaker, that they were simply subsidizing the companies to facilitate a soft landing, I say bullsh[xx]. Washington’s big swinging dicks, led by private equity money men with a similar anatomical affliction, honestly thought they could “fix” Detroit.

Maybe they could have. But it looks like they didn't. ... Most obviously, they seem to have grossly misperceived consumers' reaction to the equities of the bailout itself.  And that 45% can't be all Republicans. ... 1:53 A.M.

___________________________

Shafer couldn't take a full day of the Atlantic's "First Draft" conference. He tried. ... In the wheat vs. chaff contest, it appears to have been Chaff City. ... P.S.: Is it really true that only 220 people were watching the feed of the Petraeus session? Janet Napolitano drew 132? Those are almost Pseudo.com numbers! Don't tell Boeing. ... [Ah but they were the right 132 people--ed. No they weren't. One of them was Shafer.] ... Bloggingheads is CBS in comparison. ... 2:29 A.M.

___________________________

@kausfiles--Does the Right Resent Glenn Beck?

Amplified and edited entries from the kausmickey Twitter feed. ... Just don't call them "curated."

My friends on the Right don't like Glenn Beck either. In private, they say he's a careerist phony. about 15 hours ago

__________

I don't think the last line of this Andrew Sullivan post will make Bartlett's http://bit.ly/2EtsLJ12:17 AM Sep 11th  

__________

The 'M' Word! "Did that clerk just call you 'ma'am'?" Subtle anti-Boxer shot in Mitsubishi Lancer ad before KCAL scandal report video? http://bit.ly/hcwa6 1:44 PM Sep 9th  

__________

Is Tom Wilson--who produced Dylan's "Like a Rolling Stone," Velvet Underground's "Sister Ray" et al--wildly undersung or did he just preside and not do that much? 3:52 AM Sep 9th

__________

Poor L.A., off in its own little corner of Chris Wilson's News Dots news map. http://bit.ly/d2reS That's sure how it feels to us out here! 11:13 AM Sep 8th

__________

Even Van Jones' friend Arianna says, after talking to him and presumably getting his side of the story, that "it was stupid of Van to put his name on a very stupid '9/11 Truth Statement.' " 1:06 AM Sep 8th     

__________

Note to Slate ad corps: Wouldn't a 3 sec. ad that made you like H-P be better than a 10-15 sec. screen-hog ad that made you hate H-P? 11:29 PM Sep 7th     

__________

Got new ish of Automobile. Have a) glossy car mags gotten dull, or b) do opinionated blogs like Truth About Cars just make them seem dull? It's not only (b)! When these magazines get desperate for ad dollars, as they are now, they become scared to exist. ... 10:10 PM Sep 7th

 4:58 P.M.

___________________________

Labor Day Shock Poll!

Gruesome new poll numbers on public support for unions--the percent who say they "mostly hurt"the U.S. economy jumps from 39% in 2006 to 51% last month, for example.  .... Tom Edsall calls them "horror show numbers" and wants an explanation! Hmmm. I wish I could say "card check"--the labor plan to avoid secret ballots when organizing--but that isn't the most visible of the roles unions have played recently. The most visible would be 1) the auto industry, where the UAW helped bankrupt two of the Big Three and stuck taxpayers with the bill without even taking a cut in hourly pay, and 2) the public schools, which the teachers' unions have helped to degrade in a way that adversely impacts the lives of even affluent Dem yuppies (at least those with kids). ...It will be hard for me to avoid the Howell Raines Fallacy on this one: Once again the great and good American people have it right. ... P.S.:  Polls like this aren't going to make it easy for the Senate to pass even a watered-down labor law "reform." Did the UAW kill "card check"? ... 8:56 P.M.

___________________________

Pull the Triggers: If you want to compromise on the public option, isn't the federalism route better than the currently much-discussed "trigger" approach? Triggers are complicated and subject to gaming. It's hard to see how they can even be drawn up fairly if nobody knows what to expect in a reformed health insurance market. But it's easy to say that 10 states can apply for federal funds to launch a public option. Or 20 states. Or 30.  Even the most inept negotiators should be able to arrive at some number between 0 and 50. And then in a few years we'll have a better idea what the private insurers can accomplish on their own and what a public option adds. (The intra-state comparisons would also provide an incentive for the private insurers to behave.) ... Buried Lede: Rep. James Clyburn is talking about a federalist compromise. He's not Senator Snowe, but he's in the Dem House leadership. ... 9:30 P.M.

___________________________

Blame Orszag First!

Kareem wants to coach the Lakers. ... 4:17 P.M.

___________________________

Kf welcomes Howard Fineman to the Blame Orszag Club:

Orszag's fantasy
Every president wants to reconcile frugality and generosity, and there is always an ambitious and clever aide willing to tell him it can be done. In Obama's White House it is Budget Director Peter Orszag, who confidently told Obama that carefully administered universal health coverage would save the government money in the long run. ...  [snip]

Obama doesn’t like to make enemies, and he loved the idea — fueled by the likes of Orszag — that he could fight the reform battle on conservative turf: that we need to completely change the system because otherwise we will go bankrupt as a country.

But that was a tactical mistake on two fronts. First, Elmendorf undercut it with three devastating CBO reports.

And even if the proposals did save the government money, Republicans in Congress weren’t going to care!

For two generations, they were on the receiving end of Democratic fear-mongering how the GOP wanted to “throw grandma in the snow.” Now they are relishing the chance to accuse Obama of the same thing.

Prediction: CW by September 14. ... 9:49 P.M.

___________________________

Do the folks over at NRO's The Corner realize that The Man Who Shot Liberty Valance is a Marxist movie? Forces of production (sheepherders, farmers) meeting fetters (cattle barons, Lee Marvin). Bourgeois freedoms (Jimmy Stewart) the product not of incremental progress but of a violent revolutionary moment (John Wayne). Etc. ... 10:57  P.M.

___________________________

'Little GM, You Used to Be So Big': Harry Shearer has written Fresh New GM!'s theme song. ... It even has a bridge. ... Downloadable Sept. 8, apparently. ... P.S.: TTAC's thorough review of GM's uninspiring future product plans (mainly a flood of ... Buicks)  suggests that Shearer has the tone about right. ... P.P.S.:  I'm not predicting New GM! will fail. But it's hard to see it succeeding without the immediate labor cost advantage that Ron Bloom and Steve Rattner failed to negotiate for them, or an infusion of outside a---kicking executives that hasn't happened either. ... Plus: Some anti-Lutzism. ... It looks as if the one American plant where UAW workers built Toyotas--the NUMMI joint venture with GM in San Jose, started in 1984--will close. NUMMI's products had a good reputation, but apparently it was only profitable "for a single year." ... 11:47 P.M.

___________________________

Ross Douthat wants the GOP to stop defending grandmas against Orszagist curve-bending and

stand for the principle that Medicare can't pay every bill and bless every procedure

As a Democrat, I applaud this long-overdue attempt to return Republicanism to its historic mission. It will be comforting to see Douthat's party reclaim its its traditional image as skinflints attempting to deny the poor and elderly compassionate medical treatments and benefits that might prolong their miserable lives. It's been getting confusing lately! ... Maybe we can trade them Orszag for a pro-life big spender to be named later. ... 11:51 P.M.

___________________________

Dems' August Nightmare: Get Me A Sense of Absurdity And Make It Snappy!

Tuesday, August 4, 2009 

Jonathan Alter, pretending he's for the health care status quo to show how absurd that is, touches on the reason why I'm also attracted to government-run health care: because it will be less stingy with treatments and procedures than private insurers.

Speaking of fair, it seems fair to me that cost-cutting bureaucrats at the insurance companies—not doctors—decide what's reimbursable. After all, the insurance companies know best. 

The problem, of course, is that if the government won't second guess your doctor in the name of saving money, then how is it going to "bend the cost curve" as Obama promises it will? Won't more treatments cost, you know, more? At the very least, Alter's desire sits uncomfortably with Obama's cost-cutting rationale. And it sits very uncomfortably with Obama's concrete proposal to establish a commission of cost-cutting bureaucrats-- government bureaucrats rather than private ones--whose purpose is precisely to "decide what's reimbursable" even if your doctor might disagree. ... I suppose you could argue that Obama's expert cost-cutters will be so brilliant that you'll get all the treatments the evil insurance companies would deny you and be denied only treatments--duplicative X-rays, etc.-- you really wouldn't want anyway, with the net result of a huge cost savings. That seems a tough sell, though. ... [You have better solution?-ed The solution is to not expect pretend that health care security will save money.] ... 11:30 P.M.

___________________________

If the Cash for Clunkers program was insidiously rigged to steer people toward SUV purchases, it doesn't seem to be working. Seven of the top 10 cars purchased are small sedans. One is a midsized sedan. One is the Ford Escape, a small SUV. The 10th is the Dodge Caliber, which is a sedan pretending it's sorta kinda an SUV. ..  4:05 P.M.

___________________________ 

Is it possible that Dem politicians are in for an August of furious town hall feedback so brutal that it all becomes absurd and breeds a grim, amused fatalism that actually steels them to proceed on health care? Just asking. ... If you're going to die, might as well die having enacted universal health care. ... Remember how Tom DeLay and the GOP reacted to their drubbing at the polls in 1998 on the impeachment issue? (They went ahead and impeached.) ... 4:04 P.M.

________________________

At kf It's All-Platform Game-Changers 24/7

Harry Reid or Casey Jones? According to Roll Call, Senate Majority Leader Harry Reid is "sketching a process for railroading the [card check] bill through the floor as quickly as possible."  And maybe not even the vaunted "compromise" card check bill, says Jennifer Rubin--she suggests some union leaders are holding out for allowing labor organizers to avoid secret ballots. ... Obviously this isn't legislation that holds up in public view for long, so the rush approach is strategically sound. But Reid sems like a deeply cynical operator. He apparently likes to engineer train wrecks. (Remember what happened to "comprehensive immigration reform"?) Is he really trying to ram this explosive bill through, or is he trying to demonstrate to labor that it can't be rammed through? ... I note that even Rubin, a congenitally optimistic they-don't-have-the votes card check foe, seems rattled. ... 1:54 P.M.

___________________________

Old Comeback: "I'd rather waitress."

New Comeback: "I'd rather have a seat in the European Parliament."

12:55 A.M.

___________________________

I'm sure the NYT has already assigned a top reporter to find out what Steve Rattner's old colleagues at Quadrangle think of him. Aren't you? ... 12:45 A.M.

___________________________.

Postrel 1, Orszag 0: As originally presented, OMB Director Peter Orszag's vaunted "game-changers" were cost-saving changes to the entire health care system. The implication--in Obama's big February Congressional Address (and in Orszag's blog posts) was that you couldn't get the game-changing changes unless you had "comprehensive health care reform," including expansion of coverage to offer "quality affordable health care to every America," According to Obama

 [I]t's a step we must take if we hope to bring down our deficit in the years to come.

Along came Virginia Postrel, who noted in a blog post that if Orszag's changes were so great, why didn't he apply them to Medicare and Medicaid first? Orszag was concerned and conscientious enough to phone Postrel  to defend himself. But now, with Orszag and Obama having wholeheartedly embraced the IMAC plan to cut Medicare expenses in the long run, hasn't Postrel's suggestion won out? IMAC appears to be restricted to recommending changes in Medicare, not the entire health delivery system.

That, of course, is a tacit admission that controlling the federal budget deficit by cutting Medicare and expanding non-Medicare health coverage are two separate policy initiatives--and that Obama was dissembling when he said, in his address, that you had to do both parts at once "to bring our deficit down." It looks like you could have an IMAC panel to cut Medicare costs and shrink the deficit without any of the rest of Obama's "comprehensive" reform, including universal coverage. Or you could have the rest of Obama's reform without the IMAC panel.

The connection between the two appears to be entirely political, and conjectural--the idea that either you need IMAC as a way to get Blue Dog votes for expanded coverage, and that only by offering an extension of coverage can you get the senior lobby (AARP) to go along with Medicare changes. Like so many "comprehensive" reforms, it's not an interlocking web of mutually dependent policy mechanisms so much as an interest-group sandwich.

If all you had to do is appease the Blue Dogs and AARP, the strategy might be sound. The problem is that the IMAC "game changer" scares the daylights out of lots of people, and adds to the ballast of the whole package with the general public. ... 12:41 A.M.

_____________________________

GM's best cars--the Chevy Malibu, the forthcoming Buick LaCrosse and possibly the next Buick Regal--are all basically Opel designs. Yet GM is selling Opel. I don't get it. ... 12:35 A.M.

_____________________________